1. Noncallable bonds that mature in 12 years were recently issued by Sternglass Inc. They have a par value of $1,000 and an annual coupon of 6%. If the current market interest rate is 9%, at what price should the bonds sell?
2. Assume that the risk-free rate is 5.5% and the required return on the market is 10%. What is the required rate of return on a stock with a beta of 0.9? Round your answer to two decimal places.
3. The loan has 100,000 in principal outstanding. The interest rate is 10% and the annual payment is 20,000. What is the principal paid off within the next year, the principal remaining after the next year payment, and the interest payment for the next year?